Purifoy v. Mercantile-Safe Deposit & Trust Co.

• Decision Date: 07 November 1974
• Docket Number: MERCANTILE-SAFE,No. 1,1
• Parties: Carolyn Bauernschmidt PURIFOY et al. v.DEPOSIT AND TRUST COMPANY, Trustee, et al. Misc.
• Court: Maryland Court of Appeals

Page 58

273 Md. 58

327 A.2d 483

Carolyn Bauernschmidt PURIFOY et al. v. MERCANTILE-SAFE DEPOSIT AND TRUST COMPANY, Trustee, et al.

Misc. No. 1.

Court of Appeals of Maryland.

Nov. 7, 1974.

William A. Snyder, Jr., and Donald C. Greenman, Baltimore (Ober, Grimes & Shriver, Baltimore, and Ben R. Miller, Baton Rouge, La., on the brief), for petitioners.

Daniel H. Honemann and Allan H. Fisher, Jr., Baltimore (Walter E. Black, Jr., Robert Sloan, III, Clapp, Somerville, Black & Honemann and Fisher & Fisher, Baltimore, on the brief), for respondents.

Argued before MURPHY, C. J., SMITH, ELDRIDGE and O'DONNELL, JJ., and JAMES C. MORTON, Jr., Special Judge.

MURPHY, Chief Judge.

Carolyn Bauernschmidt Purifoy (Carolyn) and her mother Grace M. Bauernschmidt (Grace) (the appellants) instituted a declaratory judgment proceeding on October 10, 1972, in the United States District Court for the Distirct of Maryland; they sought a declaration that by reason of the provisions of Maryland Code (1957, 1973 Repl.Vol.) Art. 16, § 78(c), the terms 'child,' 'children,' 'descendants' and similar terms used in trust instruments which were executed by various members of the Bauernschmidt family and which became effective prior to June 1, 1947, included Carolyn, an adopted child. Concluding that the threshold issue in the case involved construction of a state statute 'which may be determinative of the cause . . . as to which there is no controlling precedent in the decisions of the Court of Appeals of Maryland,' the District Court, acting in pursuance of the Uniform Certification of Questions of Law Act, Code (1974) Courts and Judicial Proceedings Article, §§ 12-601 to 12-609, certified for our consideration a 'question of law and statement of facts relevant thereto.' In a memorandum opinion accompanying its certification order, the District Court set forth the factual and legal background of the case as follows:

'In general, all five instruments ¹ create trusts, the income or portion of income thereof to be paid to William Bauernschmidt, Jr. for his life, and upon his death the income and/or principal to be paid to the said William Bauernschmidt, Jr.'s 'children' or 'descendants' living at his death. If he should die without child or descendant, the share would be distributed in various ways to William Bauernschmidt, Jr.'s brothers, sisters, first cousins, nephews, or nieces. Each trust instrument was executed and became effective prior to June 1, 1947.

'William Bauernschmidt, Jr. and his wife Grace were married in January, 1940. At the time of their marriage, Grace already had a natural daughter living with her, the plaintiff Carolyn. After two attempts to have children by Grace resulted in miscarriages, William legally adopted Carolyn on January 13, 1948. William Bauernschmidt Jr. died on July 24, 1972.

'The critical question presented by the instant case is as follows:

'Do the terms 'child,' 'children,' 'descendants,' and similar terms used in the five trust instruments include the plaintiff Carolyn Bauernschmidt Purifoy, an adopted child, (and her descendants)?'

'From a complete consideration of all the trust instruments in the instant case, this Court finds that it is impossible to determine whether the testators or settlors actually intended to include or exclude adopted children. The only terms used to describe the class in question are 'child,' 'children,' and 'descendants.' No reference is made to adopted children in any of the instruments. At the time each instrument was executed, William Bauernschmidt, Jr. was unmarried and without any natural children. Thus the terms 'child,' 'children,' etc. could not have designated any particular person or persons. The gift was to a class that would come into existence some time in the future.'

'Since adoption was unknown to the common law, the state statutes with their judicial construction govern the rights and liabilities of adopted children. In Maryland, the statute in effect from 1912-1947 (the period when the five trust instruments at issue became effective) was Article 16 §§ 76 and 78, which read as follows:

'76. The effect of such decree of adoption shall be to entitle the child so adopted to the same rights of inheritance and distribution as to the petitioner's estate, and the same rights or protection, education and maintenance as if born to such petitioner in lawful wedlock, and the natural parents of such child shall be freed from all legal obligation towards it, provided that where such child inherits property from its adopted parent or parents, upon it dying intestate without issue the property thus inherited shall descend and be distributed to the same persons who would take the same by inheritance and in course of distribution if the child had been the child of the adopted parents born to them in lawful wedlock; provided, however, that this shall not be construed to limit or interfere with the power of disposition over such property by gift, grant, devise, bequest or otherwise by said adopted child.

'78. The term 'child' or its equivalent in a deed, grant, will or other written instrument shall be held to include any child adopted by the person executing the same, unless the contrary plainly appears by the terms thereof, whether such instrument be executed before or after the adoption. (Emphasis added by District Court.)

'The Maryland Court of Appeals construed this statute in the case of Eureka Life Insurance Co. v. Geis, 121 Md. 196, 88 A. 158 (1913) to allow an adopted child to take under the will of his adoptive parent, but not to take through the parent from the parent's lineal or collateral kindred. In 1947, Maryland's adoption law underwent a major revision, the purpose of which was to accord adopted children all of the legal rights of natural children and to sever all of the adopted child's ties with his natural parents. Article 16 § 78(c) of the new law (chapter 599 of the Acts of 1947) read as follows:

'The term 'child,' 'heir,' 'issue,' 'descendant' or an equivalent in a deed, grant, will or other written instrument shall be held to include any adopted person, unless the contrary plainly appears by the terms thereof, whether such instrument was executed before or after the entry of the interlocutory decree of adoption, if any, and if none, before or after the entry of the final decree of adoption.

'This section soon came before the Court of Appeals in the case of Gutman v. Safe Deposit & Trust Co., 198 Md. 39, 81 A.2d 207 (1951). In Gutman the testatrix died in 1923 and in her will gave a life estate to her son with the remainder to the son's 'child or children or descendants.' The son died in 1948 and was survived by a natural child and a child adopted prior to 1947. The Court declared that the only issue before it was whether the adoption statute was retrospective. The Court held that the Act was not retrospective, that the law in effect at the testatrix's death (1923) was to be applied, and that, consequently, the adopted child could not take as a 'child' or 'descendant' under the will of his adoptive parent's mother.

'In 1961, however, (by chapter 287 of the Acts of 1961) the Maryland Legislature amended Article 16 § 78(c) by adding the following language at the end of the section:

'. . . in the event such instrument was executed prior to June 1, 1947, the provisions of this subsection shall apply to those adopted persons as to whom the interlocutory decree of adoption, if any, and if none, the final decree of adoption was entered on or after June 1, 1947. (Emphasis added by District Court.)

The effect, if any, of this amendment has yet to be determined by the Court of Appeals.

'In sum, this Court is confronted with a case in which there are two diametrically opposed rules of construction that can be applied to the trust instruments. One rule, embodying an affinity for blood relations, was in effect at the time of execution and effective dates of the wills, while the recent rule, reflecting a fundamental shift in favor of full rights for adopted children, was in existence when the plaintiff Carolyn was adopted and when the life tenant died. Although Maryland appears to adhere to the principle that the law in effect at the execution of the will is to be applied (see Gutman v. Safe Deposit & Trust Co., supra,) this precept cannot be invoked if the later statute is deemed to have a retrospective effect. Therefore, the threshold issue in the instant case is whether Article 16 § 78(c), as amended in 1961, renders the Act of 1947 retrospective. This question involves only the construction of a state statute and does not entail any consideration of the rights guaranteed by the United States Constitution. For if the statute is held prospective, no constitutional issue is raised. It is only if a retroactive construction is placed on the statute that a second and separate issue emerges-whether the retroactive statute divests vested property rights in violation of the due process clause of the Fourteenth Amendment.

* * *'

The question of law certified by the District Court is as follows:

'Does the Act of 1961, Chapter 287 (the 1961 amendment to Article 16, § 78(c)), render the Act of 1947, Chapter 599, retrospective so that the terms 'child', 'children,' 'descendants' or an equivalent in instruments executed and effective prior to June 1, 1947, include adopted children if the adoption took place after June 1, 1947; or does the Act of 1947, Chapter 599, as amended by the Act of 1961, Chapter 287, remain prospective so that the terms in question do not include adopted children where the instruments were executed and effective prior to June 1, 1947, and where the adoption occurred after June 1, 1947?' ²

(1)

The appellants claim that the provisions of § 78(c) are so clear, explicit and direct that no interpretation or construction is needed; they urge that we summarily dispose of the certified question by declaring that § 78(c), by its plain and...